There’s a debate looming in New Jersey over the future of intrastate internet gambling. Would licensing the industry require approval from the general public in the form of a referendum? Or would the state’s legislature merely need to pass a bill? According to a CBS News article this week, “[New Jersey Governor Chris] Christie said he could conceivably sign a bill approving internet gambling without a referendum, as long as the state Attorney General’s Office and other legal authorities he has consulted say it would be okay [constitutionally].”

“Given the fact that casino gambling in New Jersey is already part of the constitution, we need to take our time to make sure any law that was written would conform to New Jersey’s constitution,” Interactive Media Entertainment and Gaming Association(iMEGA) Chairman Joe Brennan told PocketFives on Thursday.

He elaborated, “That’s why the bill is written the way it is, limiting the licensing for internet gambling operators solely to Atlantic City-based casinos because those are the only ones provided by law to offer casino gambling in the state. Arguments other than that have been used as stall tactics by Caesars Entertainment and Boyd Gaming, who prefer to have a Federal solution or prefer Nevada to be the center of internet gambling because that’s where their corporate headquarters are.”

You’ll recall that last year, Christie vetoed a measure that would have paved the way for Web gaming in the Garden State. The bill, which State Senator Raymond Lesniak (pictured) introduced, passed by a landslide in both chambers of the state’s legislature, but failed to make it past the Governor’s desk. Christie was concerned, in part, that the bill would violate New Jersey’s constitution.

“The bill’s opponents are raising questions about constitutionality. For the most part, the consensus is doing this through the legislature. The only other threat comes from the horse racing industry. Right now, there is no provision that provides subsidies that the horse owners have accustomed themselves to receiving from the casino industry over the last few years. I think their negotiating hand is weak. They played their hand too early.”

New Jersey is laid out such that the horse racing tracks are predominantly in the north, while Atlantic City, where the state’s only land-based casinos are found, is positioned in the south.

“We already know that two decisions by the New Jersey Supreme Court regarding gambling in Atlantic City support the path that’s being taken right now of direct legislation and not a referendum. The only people standing on the other side are people doing it for self-interest reasons [like land-based casino owners who prefer a Federal or Nevada-based solution as well as members of the horse racing industry.”

Since receiving the axe from Christie, Lesniak has introduced another bill that was voted out of a State Senate committee two weeks ago. The Assembly Regulatory Oversight and Gaming Committee has delayed a vote on the bill so that it can take testimony on it from a constitutional perspective. Meanwhile in Nevada, licensees are already being vetted and regulated online poker rooms could launch by year’s end.

New Jersey law could still prove to be murky, however. To that end, a Seton Hall constitutional law professor told the committee in a report on NJ.com, “Assembly Bill 2578 and Senate Bill 1565 are not violations of the constitutional provisions requiring the voters to approve gambling because the voters have already approved voting in Atlantic City by its vote in 1976… An amendment would be needed, however, if lawmakers were seeking to legalize gambling outside of Atlantic City.”

If approved, would internet gambling thrive in New Jersey? Would enough liquidity exist for the industry to be economically viable? Brennan was optimistic: “Internet gambling works in populations where people don’t want to, or can’t, go to a casino. It works in New Jersey because Atlantic City is southeast of the population center in the state.”